All the state pensioners who’ll get Winter Fuel Payment taken back by HMRC | Personal Finance | Finance
A Government U-turn will see the Winter Fuel Payment restored to the vast majority of pensioners this winter, but some face having the payment taken back by HM Revenue and Customs (HMRC).
Chancellor Rachel Reeves has said around nine million pensioners in England and Wales are in line to receive the Winter Fuel Payment this year, which is worth up to £300. The £1.25 billion U-turn came after Reeves said the government had “listened to people’s concerns” about the decision to limit the payment to only the poorest pensioners last year. Labour previously restricted it to those claiming Pension Credit or other income-related benefits to try and plug a £22 billion “black hole” in the public finances.
The move meant the number of pensioners eligible for the payment plummeted from around 11.4 million to just 1.5 million. But Reeves said the government is now able to widen eligibility because of the “stability” Labour has restored to the economy.
The payment will still be means-tested, but at a higher level than last year, to those with an income under £35,000 per year, meaning some pensioners will still miss out.
To be eligible, a person needs to have reached State Pension age by the end of the qualifying week, which will be from Monday, September 15 to Sunday, September 21 2025, and meet the new income threshold. Those that meet this criteria will get the payment automatically.
Those with an income above the £35,000 threshold will also receive the payment, but it will then be automatically reclaimed from them in tax by HMRC via PAYE or in their Self-Assessment tax return.
The government has said a system will also be set up for those who want to opt out from receiving the Winter Fuel Payment, thereby removing the need for HMRC to recover the payment.
HMRC will also not try to recover Winter Fuel Payments from people who have died, Downing Street has said. The Prime Minister’s official spokesman confirmed: “HMRC will not ask for repayment from a deceased PAYE (pay as you earn) customer if the only money owed was from a winter fuel payment.”
HM Treasury said: “The payment will be recovered from individuals via HMRC based on their individual taxable incomes. There will be no need for household incomes to be aggregated.
“It will be recovered via PAYE for the vast majority, or in their Self-Assessment tax return for the minority who file and pay their taxes in this way. HMRC will work closely with representative bodies to ensure the process is as simple as possible with clear guidance for taxpayers.
“For those who would like to opt out from receiving the Winter Fuel Payment, DWP will develop a simple system to enable individuals to do so, removing the need for HMRC to recover the payment. Further information will be on GOV.UK in due course.”
